Patreon Drops Service Fee, Apologizes To Users

Competition between content creator platforms is growing thicker daily and any misstep could be costly as platforms try their best to stand out. Patreon made an interesting decision to remove processing fees from a creator's monthly funds and incur it upon patrons, but some argued that this new model penalizes those that donate smaller amounts. Patreon has heard the critiques from the creators, scraped the new service fee model, and apologized to users.

Patreon broke the news today with a blog post featuring a headline that got straight to the point: We messed up. We’re sorry, and we’re not rolling out the fees change. The blog post points out these specific critiques that arose:

The new payments system disproportionately impacted $1 – $2 patrons. We have to build a better system for them.

Aggregation is highly-valued, and we underestimated that.

Fundamentally, creators should own the business decisions with their fans, not Patreon. We overstepped our bounds and injected ourselves into that relationship, against our core belief as a business.

The team wants to fix what they hoped to address with these new fees, but is looking to engage with their community more as they work to do so. This is something YouTube should learn from sooner rather than later as well. Though the service fees are scrapped for now, the introduction of this model still caused a ripple across the Patreon communities. Twitter user TheBreeMae asked what Patreon would be doing to help recoup the patrons that were lost when creators shared the news and Patreon responded that they "want to talk about it too."

With a new major competitor springing up in the form of Kickstarter's Drip, the teams behind Patreon can't drag their feet when such a significant change draws the ire of their community. Things look good so far, but let's hope the open communication and rapid responses continue.

Charles Singletary Jr keeps the updates flowing as the News Editor, breaking stories while investigating the biggest topics in gaming and technology. He's pretty active on Twitter, so feel free to reach out to him @The_CSJR. Got a hot tip? Email him at Charles.Singletary@Shacknews.com.

Probably the huge backlash on that one. Most creators sent out emails about it saying how bad it was. I mean sure the creator gets more, but it's more visible to the end user. It's one of those things that is better hidden from the end user even though it still is happening.

I'm pretty sure the creators weren't going to get more. Patreon would have taken the same cut on the creator side while increasing the both the percentage and per-donation fees on the contributor side.

Not quite. The total cut Patreon took on the creator side would have gone down, so they would in fact receive more on a per-donation level. The issue is that moving the fees to the contributor side in the way they proposed would have totally screwed anyone who supported at a low dollar level, and especially those backing multiple creators (since the fees were to be applied to every donation individually). This in turn hurts creators (especially smaller ones), since your $1 backers are now all of a sudden paying $1.38 for you to now get $0.95 out of. It doesn't matter if you're making another 10 cents per donation or whatever if half the people backing at that level just dropped out.

A better solution would have been to find a better way to minimize transaction fees. Charging everything on a per-month basis in a single batched transaction and taking it out of the creator end is probably the most backer-friendly way to do it. And anything you can do to make it easier to back creators means more people will.